Extra Point

by Jack Tenney, Publisher

July 2011

"Under S.17 dispensaries may acquire marijuana seeds or parts of the marijuana plant capable of regeneration from registered patients or their caregivers or from the other registered Vermont dispensary. They may cultivate and possess up to 55 immature marijuana plants, 35 mature marijuana plants, and 80 ounces of usable marijuana at any one time.”

–according to Kim I. Hartman, Digital Journal, Monday, June 13, 2011; found on the website of Cannabis Culture.

That short paragraph doesn’t say it all about the rigors of running an “a-pot-hecary” but is fairly precise. As you may know, S.17 was recently signed into law by the governor and sets in motion an opportunity for four nonprofit-minded entrepreneurs to have a license to legally sell marijuana. Presumably, one can be assured of not running a profit by balancing excess revenues over direct costs. Just jigger one’s salary and benefits. Structure leases. Get remuneration for financing guarantees. Do pretty much what any other eleemosynary enterprise does and, poof! No profit.

The trick, I would think, is, as the UPS — or is it FedEx? — ad goes, logistics. How to run the factory at full tilt?

First off, you must have immature plants becoming mature on the same schedule as the mature plants are harvested. Then the crop must be blown out the door fast enough to maintain inventory levels at less than 80 ounces of usable marijuana at any one time.

You have to imagine a little wiggle room between harvesting and inventory. Like if you were manufacturing bird cages and you weren’t allowed to exceed so many coils of wire or so many units of finished cages, wouldn’t you stack up the cages to one side as work-in-progress and only box up enough to meet demand?

Presumably, there are pretty severe penalties for getting out of cycle. According to one operator in Colorado, where I’m told pot shops in Denver are almost as numerous as Starbucks, the biggest problem in staying legal is controlling the number of plants in cultivation.